Workshop

Howard Marks frames active management as the search for mistakes. A market mistake is a mispricing: an asset priced too low or too high relative to value and ri

Agentic coding workflows use AI systems as semiautonomous execution agents rather than passive autocomplete tools. The human's role shifts from writing every li

The argument that AGI and superintelligence are fundamentally national security challenges rather than consumer technology products. Whoever leads in superintel

Alternative histories are the plausible paths that could have happened but did not. In sources/fooledbyrandomness, Taleb argues that decision quality cannot be

A framework by Benjamin Bloom describing the three stages through which worldclass performers develop, based on studying 120 elite performers across music, athl

Bubble detection is the practice of judging market behavior around a theme, not merely deciding whether the theme itself is real. Howard Marks' bubble framework

Chunking is the process of binding separate pieces of information together through meaning into a single retrievable unit — a "chunk." It is the fundamental mec

Know the boundary of what you actually understand — and stay inside it, or expand it deliberately before acting outside it. The concept applies to investing, ca

The confidence cycle is Howard Marks' idea that belief, optimism, and certainty move in selfreinforcing waves. Confidence affects both the economy and markets:

The credit cycle is Howard Marks' framework for how the availability of capital expands and contracts. He treats it as the most volatile and marketmoving cycle

Credit investing is mostly the art of avoiding losers rather than finding uncapped winners. In equities, a few huge winners can dominate returns. In credit, ups

A good decision can produce a bad outcome, and a bad decision can produce a good outcome. Howard Marks returns to this idea through Nassim Taleb's "alternative

Each day contains a handful of moments that disproportionately shape everything that follows. Clear calls these "decisive moments" — the forks in the road where

Deliberate practice is the highestleverage mode of skill training. It involves: 1. Working on tasks just beyond your current ability level 2. Getting immediate

Economic reality is the constraint layer: scarcity, tradeoffs, incentives, productivity, secondorder consequences, and the fact that one cannot get all desirabl

German for "installation" — a cognitive phenomenon where an idea you already hold in mind blocks you from seeing a better idea or solution. Your existing mental

People with the "best selfcontrol" are usually people who structure their environment so they rarely need selfcontrol. Discipline is not a personality trait — i

The shared public information environment — the "water supply" for minds. Just as clean water enables physical health, a clean epistemic commons enables coheren

Epistemic humility is the discipline of matching confidence to evidence. In The Complete Collection Howard Marks, it becomes especially visible during the COVID

The property of a system where the timeaverage of an individual path equals the ensemble average across all possible paths. Most realworld repeatedrisk processe

Munger's coined term for the functional equivalent of embezzlement. Derived from Galbraith's concept of the "bezzle" — undisclosed embezzlement that stimulates

First principles thinking means breaking a problem down to foundational truths and rebuilding from there, rather than copying existing templates or reasoning by

The brain operates in two fundamentally different modes, and effective learning requires toggling between both. Tight, concentrated, analytical thinking Uses th

James Clear's actionable framework built on the habit loop cue → craving → response → reward. Each law targets one phase of the loop. Each has an inversion for

All human systems get gamed. People display great ingenuity in serving themselves at the expense of the system's intended purpose. Antigaming features are there

Peak motivation occurs when working on tasks of "just manageable difficulty" — approximately 4% beyond your current ability. Too easy and you get bored. Too har

Children must eat their carrots before they get dessert. The business version: force yourself to do the unpleasant and necessary tasks first, then reward yourse

Habit stacking links a new behavior to an existing one using the formula: "After CURRENT HABIT, I will NEW HABIT." Existing habits are already encoded as strong

Habit tracking is the practice of measuring whether you performed a habit. The simplest form: mark an X on a calendar each day you complete the habit. "Don't br

Happiness as skill is Naval Ravikant's view that happiness can be trained like fitness, nutrition, or wealth creation. It is not merely inherited, found, or ear

Identitybased habits flip the direction of behavior change. Instead of starting with outcomes "I want to run a marathon" or processes "I need to run every morni

A Japanese concept roughly meaning "reason for being." In the context of skill development and career, it refers to the intersection of: 1. What you love — intr

The gap between feeling like you know something and actually knowing it. This is arguably the single most important concept for any learner to understand, becau

An implementation intention is a predecision about when, where, and how you will act. The formula: "I will BEHAVIOR at TIME in LOCATION." Hundreds of studies sh

Tendency 1 in Munger's 25 tendencies. Munger places it first because, despite everyone thinking they understand incentives, almost everyone underestimates their

The idea that once AI systems can automate AI research itself, progress becomes recursive and explosive: smarter systems produce even smarter systems in a tight

"Invert, always invert." — Carl Jacobi mathematician, adopted by entities/charlesmunger. Inversion means solving problems backward: instead of asking "How do I

Investment styles move in and out of favor like clothing hemlines. Howard Marks uses this as a concrete form of secondlevel thinking: the question is not whethe

Munger's term for the discipline of seeking disconfirming evidence, especially for your bestloved ideas. Named after Darwin's practice of giving special attenti

The claim that all learning is fundamentally memorybuilding. "Understanding" is not a categorically different thing from "memorization" — it is deeper, richer,

Liquidity risk is the risk that an investor cannot sell an asset quickly at a fair price when they need to. Howard Marks treats liquidity as transient and parad

When multiple psychological tendencies act in confluence toward the same outcome, the result is extreme — often far beyond what any single tendency would produc

Howard Marks' 2022 memo "Selling Out" argues that investors often sell for psychologically satisfying reasons rather than analytically valid ones. They sell bec

A lowrate world is an environment where the riskfree rate is so low that prospective returns fall across nearly all assets. Howard Marks treats this as the domi

"To a man with only a hammer, every problem looks pretty much like a nail." Munger's name for the universal tendency to overapply the single tool or framework y

Munger's central framework: acquire the big ideas from every major discipline — math, physics, biology, psychology, economics, engineering, history — and organi

A framework for measuring AI progress in "orders of magnitude" OOMs of effective compute rather than benchmark scores or subjective impressions. Introduced in s

The ability to extract key features from complex environments while filtering out irrelevant noise. Experts don't just think differently from novices — they lit

Permissionless leverage is leverage that does not require someone else to give you capital or agree to work for you. Naval's main examples are code and media: p

Ancient Persians killed messengers who brought bad news. The modern version: careers are damaged by carrying unwelcome information to powerful people, even when

Munger's distinction between two kinds of knowledge, illustrated by an apocryphal story about Max Planck and his chauffeur: Planck knowledge — real understandin

Habits appear to make no difference until they cross a critical threshold. Clear calls the period before that threshold the "Plateau of Latent Potential" and th

A time management method: set a timer for 25 minutes, work with full focus phone off, internet off, then reward yourself when the timer rings. Named after the t

Position sizing is the rule for how much capital to put at risk in a trade or investment. It is the bridge between having an idea and surviving the consequences

The principle that advanced skills should only be attempted after foundational prerequisites are genuinely mastered — not just "covered." Skycak's summary: "Pre

Probability blindness is the human inability to naturally feel probability, base rates, randomness, and rare events correctly. In sources/fooledbyrandomness, Ta

The problem of induction is the limit of learning future certainty from past observations. In sources/fooledbyrandomness, Taleb uses the classic swan problem to

Munger's magnum opus: a taxonomy of 25 standard causes of human misjudgment, developed over decades of selftaught psychology and revised in 2005 at age 81. The

Reasonable expectations are a form of risk control. If return goals are too high, too smooth, or too dependable relative to the risk being taken, investors are

Scale creates both powerful advantages and dangerous disadvantages. Munger treats understanding these as fundamental to business and investing judgment. Volume

Howard Marks' "sea change" thesis: the investment world from roughly 1980 to 2021 was shaped by a fourdecade decline in interest rates, and the 2022 inflation/r

Munger's term for the highest form of human organization: totally reliable people correctly trusting one another, with minimal bureaucratic procedure. His examp

The practice of thinking past the immediate result of a decision to consider downstream consequences and the consequences of those consequences. FirstOrder Seco

Munger's term for the discipline of making very few, very large bets on highconviction ideas and then doing nothing — holding for years or decades. The opposite

Skewness and asymmetry describe payoff distributions where gains and losses are not balanced around a normallooking average. In sources/fooledbyrandomness, Tale

Spaced repetition is a practice technique that exploits the "forgetting curve" to maximize longterm memory retention. The core insight: the act of successfully

Specific knowledge is knowledge that cannot be easily trained into someone else. It is usually discovered through genuine curiosity, unusual background, obsessi

Every mischance in life, however bad, creates an opportunity to behave well and to learn something useful. One's duty is not to become immersed in selfpity, but

The technical challenge of reliably controlling and aligning AI systems that are much smarter than humans. Distinct from current alignment which works via RLHF

Supply chain resilience is the tradeoff between cheapest sourcing and dependable sourcing. Howard Marks' 2022 memo "The Pendulum in International Affairs" frame

Survivorship bias is the error of studying only the visible winners while ignoring everyone who tried the same thing and disappeared from the sample. In sources

Temptation bundling pairs a behavior you need to do with a behavior you want to do. The formula: "After HABIT I NEED, I will HABIT I WANT." Or combined with hab

The Diderot Effect states that obtaining a new possession often triggers a spiral of additional consumption. Named after French philosopher Denis Diderot, who r

Trading edge is a concrete reason a trade should have positive expected value after costs, slippage, sizing errors, and psychological mistakes. It answers the q

When starting a new habit, scale it down to something that takes two minutes or less. The goal is to master the art of showing up, not to optimize performance.

UseItorLoseIt is Munger's tendency that skills and knowledge decay when they are not practiced. In sources/poorcharliesalmanack, it appears in the psychology ch

Howard Marks' 2021 memo "Something of Value" reframes the old valueversusgrowth divide as a false dichotomy. Value investing should not mean "low multiple inves

The central insight of learning science, as presented in Advice on Upskilling, is the distinction between working memory WM and longterm memory LTM and how expe